One of the most frequently posed questions to Guy Ryder, director general of the International Labour Organization (ILO), is how he treads the delicate balance between governments, employers and trade unions. As the 57-year-old Briton began his career as a trade unionist – working for the International Department of the Trade Union Congress – people are interested to know how he managed to win the trust of employers and governments.
A graduate of Cambridge and Liverpool universities, Ryder spent much of his life in promoting the cause of labour. Even when he joined the ILO, in 1998 – where he was eventually appointed as its 10th chief – he was director of the Bureau for Workers Activities.
Ryder argues that his years promoting the labour agenda are helpful in understanding issues, which the ILO is poised to address. One such issue is the transition of the UN Millennium Development Goals (MDGs), for countries like Ethiopia, after the first term comes to an end in 2015. He told Tamrat G. Giorgis, fortune’s managing editor, the post-2015 programs should be quantifiable, simple and understandable.
Fortune: The International Labour Organisation (ILO) is soon to celebrate its 100th year anniversary. I am sure you agree with me that so much has changed since then and the new buzz phrases are shrinking governments, privatisation, labour flexibility and reduced public pension. I was wondering how the ILO sees its relevance in this new climate, where things are strikingly different from when it was first established?
Guy Ryder: We are the oldest of international organisations. You are right to say the world of work has changed and transformed over the last 90 years. When the ILO was founded, we had close to 40 members. Today we have 195 members and we are a truly global organisation. But, if you look outside of the window and see what is happening in the work place, it has little relation to what happened 100 years ago. And, that has implications for the ILO.
Although it is fair to ask our relevance, the ILO is very much a values-driven organisation. Its constitution talks about social justice and protecting the basic rights of workers. Those basic and fundamental values and principles are entirely as relevant today as they were on our first day.
The question is in our working methods and capacity to make a difference. One of fundamental changes in the world of work over the years has been the move from national economies, which operate more or less independent, to an integrated globalised labour market. It is not complete, but it is going that way. Our methods and work need to be adapted to those new circumstances, and we have to be very conscious. The way the world operates is very different.
Our member states come together in Geneva this week for the international labour conference. They will give us a strong message that they think our mission is relevant. But, they expect us to be effective and influential.
Q: The ILO stands for jobs and workers’ welfare. As a result, you have several initiatives. There is “jobs pact” and “social protection floor.” But, I don’t see them being effective. There is a gap between implementation, despite the fact that they seem to have won international support from a wide area of places and people. Why is that they are not effective?
I don’t agree with you that they are not effective. But, let me just go back to the beginning of your question. The ILO agenda, since the beginning of the century, has been based on decent work. There should be work opportunities for everybody; and the jobs offered should be of a decent quality that ought to respect peoples’ rights.
One should have a job that enables them to live in decent living conditions with a minimum wage. We believe that people should have a minimum level of social protection. Differences and conflicts, which arise in the world of work, should be resolved through social dialogue. Internationally, the idea of decent work has gained a lot of attention.
We certainly have challenges that we need to meet and there are areas we need to do better. But, every day the ILO is intervening on the ground, making a difference. Yes, we are making a difference on the ground.
Q: My understanding is that you cannot achieve this “jobs pact” after the world lost 50 million jobs because of the global recession. What happened to it?
There are 67 million job gaps after the crisis. The estimate in G-20 is that in the first years after the crisis broke, and after we adopted the global jobs pact, we would save close to 20 million jobs.
Q: What did you do?
It was done in different countries, like Germany and the Netherlands, where people got together and negotiated ways of saving jobs. Look at the Germans, for example. They did extraordinary things to keep people at work. Has it been enough? No. We have a global jobs crisis today. There are 200 million people unemployed. But, to argue, because there is a crisis, nothing we did was effective is wrong. It is a false logic. We did a lot. The situation has been a lot worse and we have a lot of things to do. I join you in considering that we face an enormous challenge.
Q: The ILO gives a lot of emphasis to the “rights based” agenda and that is in an environment where there is insecure unemployment, stagnant wages and declining benefits. There are voices, particularly coming from multinational financial organisations, that argue that the answer is labour market liberalisation policies. Do you see these as the right answer?
We have permanent and intensive dialogues, both with the International Monetary Fund (IMF) and the World Bank (WB). I am not sure your characterisation of the international financial institutions is entirely correct, although I recognise from the past some of the things you said.
The new President of the WB has a very positive agenda, in respect to employment and jobs. The WB report last year was entitled Jobs and it represents a new way of thinking about the importance of job creation, in the development processes. While I recognise what you said about the flexibility agenda in the labour market, I see evolution towards balanced approaches.
With the IMF, we have similar dialogue. We had the first joint ILO-IMF conference in 2010. I think we found a common ground and areas of dialogue, which for me marked important ways forward. We still have some difficult issues to resolve between us, but I attach a lot of importance to that dialogue.
But, you are right. I think there is still a tendency to believe the way to create jobs and to move forward is simply to create greater deregulation and greater flexibility in the labour markets. I think we should be very cautious about that type of agenda.
Q: Don’t you think that at some point in time there has to be some kind of reforms, so that the rigid labour market somehow gets flexible in favour of enterprises?
I think structural reform is a real agenda and I do not deny that this discussion is often necessary. I do not believe reforming labour markets is wrong; the excessive rigidity should be examined. But, I think we should be very careful about the notion that more and more flexibility is going to create universal job opportunities. We had the flexibility agenda since the 1980s. We also have a record level of unemployment today.
Q: And, a record level of prosperity, growth and quantity of people coming out of poverty across the world has been recorded, if you read reports published by the WB.
The fact is, there is a concentrated progress. Small number of countries made a lot more progress than others. Africa brought down its poverty levels, but not as much as we would like. If you look at the aggregate figures, some regions of the world are growing impressively. Africa is one of those regions. But, we also see very considerable growth of inequality. We have pockets of growing poverty in some countries, which I think we have to be attentive to. You have got to disaggregate the overall figures and have a look at the realities.
Q: Let’s look at the ILO in a historical prism. It is a kind of organisation that used to work on the standardisation of labour laws and ensuring decent work across its member countries. But, it is an organisation that is trying to balance the interests of governments, employers and labour. Much attention has been given by its leaders over the years to the labour issue, however, at the expense of the others. Would you agree with that characterisation?
We used to look at standards and labour legislations. We still do that. That is still frequently referred to as the backbone of the ILO’s work. We adopt international labour standards and we supervise their applications. I think everybody in the ILO would say this is the essential function of the ILO.
It is true to say that there has been some rebalancing of the ILO agenda. I would say that in the last 20 years, we have given much more attention towards enterprise promotion. We have major programmes in promoting entrepreneurship, entrepreneurial training and sustainable enterprises, which did not exist previously. I do not think that we have walked away, abdicated or abandoned the protection of labour rights and workers welfare.
Q: Do you think that, whatever you have done in shifting the focus, it has been sufficient enough to begin to address the mismatch in the labour market? On the one hand, you find highly trained people all across the world looking for jobs. Whilst, on the other hand, you find companies trying to get skills on a very necessary and basic level.
Even in times of very high levels of unemployment, generally employees cannot work the right work. They tell us this all the time. They cannot get the right types of workers or skills. You are also right to say that it is not always the top end skill. It is the soft skills – being able to deal with customers and to organise one’s work. We are very concerned about that and we made it one of our priorities for the coming years. I recognise exactly that challenge.
Q: The narrative across the world is Africa is rising, because it has registered economic growth of five percent or more. And yet, you have more than 70 million unemployed young people, between the age of 15 and 25. Are you prepared to tell African leaders, when you meet them on Saturday, that they are actually talking about this kind of growth without creating jobs?
Jobless growth is difficult for Africa and for other regions too. But, it is a challenge for Africa in particular. I do not have any problem whatsoever and I don’t think many of Africa’s leaders have a problem in recognising that jobless growth is a challenge for the continent.
One of the major drivers of growth is the natural resource commodity, which only directly employs one percent of African workers. If they depend solely and purely on that part of the economy, in order to promote jobs, they cannot afford to do it. The challenge for Africa is to spread the effects of that growth to all areas of the economy and create those other areas of the economy, which can provide opportunities for young people.
And, Africa has some major issues. Its labour markets have a high presence of rural workers. It is one region of the world where the majority still live and work in the rural economy. Africa has a high informal economy.
What we do not see developed yet in Africa is the industrial base. Industrial production, in overall gross domestic product (GDP), has not been growing over the years. I think it is below the levels in the 1970s. It seems to me that the transition of the drive for growth, from the commodity sector across the economy, is something that is needed, in order to establish a sustainable and balanced development path. This is a big part of the development challenge for Africa.
Q: Is that the message you are here to deliver to the leaders?
It is part of the message. We are absolutely ready to take our part of responsibilities. I have no intention to act as a teacher, but I want to deliver the message to African leaders, that we are ready to work with them for decent work. I believe providing decent work needs to be the centre of development policies in Africa and elsewhere. We can help to bring that idea, concept and ambition in to reality.
Q: Africa is about to close the Millennium Development Goals (MDGs) chapter, due conclude in 2015. I believe that the UN General Assembly will meet soon to review the progress and come up with what people are calling “MDG-plus”. I know the ILO is a kind of organisation, which does not impose its values and systems on member countries. It is purely voluntary. It is a nice talking place. In such a climate, what exactly are you prepared to put on the table, for the scenario after 2015?
We are coming to this 2015 crossroads. We only have another two years to continue on the MDGs. That is unfinished business and we have made a renewed commitment to work on the MDGs acceleration framework in three African countries, which are – Tanzania, Ghana and Niger.
Post 2015, we now have to set a new agenda. The UN General Assembly will meet later on this year, which will be preceded by very important steps next week, when the high level panel, established by the Secretary General, presents its report to him. The Secretary General will report to the General Assembly on what the post-2015 agenda should be. We have a very clear message; the post 2015 agenda needs to have at its heart an explicit and distinctive objective of decent work and job creation. We have to work out how we define that objective. It has to be quantifiable, simple and it must be understandable.
Q: I understand that your background is in labour union. But, you are leading an organisation that keeps a balance of tripartite interests. Coming from one side of the spectrum, how do you manage to maintain credibility in the eyes of the other two sides – employers and governments? Is it a difficult thing to achieve?
You will be surprised that this is the question I have had most frequently asked of me during the election campaigns and subsequently. It is a fair question. My easy answer, but not the whole answer, to you is, when I got elected, I must have convinced governments and employers that I could do this job in a way that reflects their interests, and I am very clear that my responsibilities lie with governments and employers, as well as workers.
I worked throughout my professional life, representing labour trade unions. That puts me in a tremendously good position to understand the needs of employees and enterprises, because I sat down with people and talked to them for years and years.
If you believe the right way to deal with them is through partnership, and not through confrontation, then you have a pretty good understanding of the needs of employees and of enterprises. I can identify, without walking away from what I believe; it gives me an advantage.
Essentially, I look at the values that drove me in my working life, 25 to 30 years before I came to the ILO. I look at the values of the ILO and it is a strong coincidence. As I said in the beginning, the ILO is a value-led organisation. I don’t feel that contradiction, which one might think would be present in this rather strange situation.
I agree it will have never happened before, that the Director General comes in from one side of the tripartite path.
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